Scandal, economy, unrest mar China's leader change

BEIJING--China's once-a-decade political transition coming this fall seems devoid of drama on the surface: It's clear who will take over, and the fight for other top spots is invisible to the public. But beneath the veneer of calm, the Communist Party is struggling to contain troubling events and mask divisions.

The world's second-largest economy is experiencing an unexpectedly sharp slowdown. Violent demonstrations percolate as people tire of corruption, land grabs and policies seen as unfair. Tensions simmer with neighboring countries and the U.S. over territorial disputes in the South China Sea. Then there's the unresolved scandal involving Bo Xilai, who was a well-connected contender for high office before he was ousted for still unexplained transgressions.

The communist grip on power isn't threatened and the lack of open elections means they require no voter approval. But the party risks eroded legitimacy and a reduced ability to impose its will further alienating younger Chinese and encouraging critical opposition voices arguing for a democratic alternative.

As the party's unstated contract with the people exchanging one-party rule for economic growth frays, pressure for reform is likely to intensify.

“The economic downturn, human rights demands and political reform are major issues for the party,'' said Wu Si, editor-in-chief of the Beijing-based pro-reform journal Yanhuang Chunqiu. “None of the leaders know what to do about it.''

Five years after he was picked as successor, Vice President Xi Jinping remains on track to take over from President Hu Jintao in the party's fall congress, where its leading members will install a new generation of leaders.

China is run by a collective leadership, and many of the other seats in the Politburo Standing Committee, decision-making's inner sanctum, are undecided, analysts and party insiders say.

Final decisions on the leadership lineup and key issues to be addressed at the congress should be hammered out in various sessions this summer, including informal meetings east of Beijing at the seaside Beidaihe resort.

None of the leading contenders--mostly proteges of Hu or other rival party elders--is trying to grab headlines.

Open politicking is strongly frowned upon, and while competition for posts and influence is intense, it takes place far from the public as the party seeks to display a united front, said Jiannan Zhu, a political scientist at the University of Nevada, Reno.

“The priority for the Chinese government ahead of the party congress is to make sure no major instability occurs,'' Zhu said.

The flamboyant Bo is one of the few Chinese politicians who did overtly campaign for a higher-level job, and that is believed to be one of the sins that led to his downfall.

His removal as party boss of the mega-city of Chongqing and suspension from the Politburo exposed divisions within the leadership. It also further convinced an already skeptical public about the greed and bare-knuckled machinations of their secretive leaders.

Bo's ouster this spring was accompanied by the announcement that his wife and a family aide were under investigation for the murder of a British businessman. Reports have said that Bo tried to quash the probe.

Trial for Bo's wife, Gu Kailai, and for his ex-police chief, Wang Lijun--who exposed the murder when he fled briefly to a U.S. consulate--could begin this month, according to diplomats in Beijing who spoke on condition of anonymity.

As for Bo himself, politically connected Chinese have previously said that party leaders would have address his fate before the congress to heal divisions, but the government and its media have said nothing about the case in recent weeks.

Dealing with Bo is believed to have distracted the leadership, delaying its response to the deepening slowdown that has dragged growth to a three-year low of 7.6 percent in the three months ending in June. Interest rates have been cut twice in the past month and a half in a bid to kick-start growth, but Beijing is powerless to stem the malaise in Europe and the U.S. that has slashed demand for Chinese exports.

The downturn could worsen unrest. China already sees 180,000 strikes, protests and other mass demonstrations each year, according to government data compiled by Tsinghua University sociologist Sun Liping.

In recent protests in the southwestern city of Shifang, high school students joined ordinary Chinese in demonstrating against a copper smelter. Images of police beating protesters bloody and firing tear gas sparked nationwide outrage after they circulated online.

Trying to put a lid on disturbances ahead of the congress, authorities are tightening already stringent controls on political critics and activists of all stripes. Wu Lihong, who once received a government award for his environmental campaigning, said he has been told not to travel or accept speaking engagements in coming months.

“They're using the congress as a pretext for every kind of restriction they can think of,'' Wu said by phone from his home near heavily polluted Lake Tai.

The need to quash unrest was underscored in a speech this week by the party's law and order chief, Zhou Yongkang, in which he ordered cadres to nip problems in the bud-- whatever the cost.

“All levels of the party and government must make maintaining stability their first responsibility,'' Zhou told security officials at a national teleconference on July 17.

Authorities also are trying to keep Chinese media in line. They dismissed two editors at Shanghai's Oriental Morning Post after publication of a story calling for private industry to enjoy the same rights as state companies.

Southern Weekly, one of the country's most widely respected newspaper groups, has seen editors replaced by propaganda officials. Editors and reporters at the paper said the new leaders spiked an interview with Shifang's party boss, who was replaced soon after the riots. The party leader defended his actions and complained about the lack of outside support, the editors said.

“Everybody feels like things are getting more oppressive. It's been happening for a long time, but the party congress is making it worse,'' said one former Southern Weekly editor who now works for online media. He asked not to be named to avoid repercussions against his new employer.

To some Chinese, government repression is raising doubts about whether a new slate of leaders will overcome entrenched interests.

Zhang Jian of Peking University's School of Government said that even if Xi were inclined to make bold social or economic changes, he would need support from other leaders, and the government's recent heavy-handed tactics make clear there is no consensus that reforms are needed.

“I see no hope at all that Xi will be able to put in place any serious, meaningful political reform,'' Zhang said.

Meanwhile, economic pressure is likely to grow. China's rapidly aging society will severely restrict the labor pool, undermining China's low-cost advantage and increasing the social security burden for workers and the state.

“The world is changing rapidly around the party. Muddling through will not be feasible during Xi's rule,'' said Harvard China expert Tony Saich. A major crisis in coming years will either demand major reforms or severely challenge the communists' grip on power, Saich said.

In this photo taken on May 4, Chinese President Hu Jintao, right, Premier Wen Jiabao, left, and Vice President Xi Jinping clap as they arrive for a conference to celebrate the 90th anniversary of the founding of the Chinese Communist Youth League at the Great Hall of the People in Beijing. Five years after he was picked as successor, Xi remains on track to take over from President Hu in the Communist Party's fall congress, where its leading members will install a new generation of leaders. (AP photo)

BEIJING--China's decision to open its streets to a wave of anti-Japan protests could end up rebounding on Beijing, which has emerged from days of fervent nationalism with eroded authority at home and fewer options in dealing with Tokyo.

SHANGHAI/BEIJING -- One of China's most conspicuously reform-minded leaders has stepped back into the spotlight after the nation's biggest political convulsion in a generation, positioning himself to gain from the fall of populist politician Bo Xilai.